Finish Line rethinking merger agreement following release of Genesco's 2Q results

By Lisa Kerner

Charlotte, N.C., Aug. 30 - The Finish Line, Inc. said it is "disappointed with Genesco Inc.'s second-quarter fiscal 2008 financial results," according to a statement released on Thursday.

"Consistent with its responsibilities to the Finish Line's shareholders, the company is evaluating its options in accordance with the terms of the merger agreement," the statement said. The Finish Line does not intend to make any additional comments on the matter at this time.

Genesco reported a loss before discontinued operations of $2.9 million, or $0.13 per diluted share, for the second quarter ended Aug. 4, according to the company's news release. For the same period last year, the company reported earnings before discontinued operations were $5.9 million, or $0.24 per diluted share.

Genesco's net sales for the second quarter of fiscal 2008 rose 8% to $328 million, compared to $304 million for the second quarter of fiscal 2007.

Because of its merger agreement with Finish Line, Genesco said it was not issuing guidance with respect to sales and earnings expectations for the remainder of the year.

Genesco shareholders are set to vote Sept. 17 on the June 18 merger agreement, which gives them $54.50 in cash, without interest, for each share of Genesco common stock they own.

It was previously reported that the transaction is valued at about $1.5 billion, and the merger of the two specialty retailers is expected to be completed in the fall.

Genesco's Nashville operations will be maintained, and the company will become a subsidiary of Indianapolis-based Finish Line.

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